Environmental DEA with Undesirable Outputs (EEI model)
DEA-ENV (Environmental DEA with Undesirable Outputs (EEI model)) is a dea multi-criteria decision-making (MCDM) method introduced by Färe, R. Grosskopf, S. Lovell, C. A. K. Pasurka, C. in 1989. It turns a decision matrix of alternatives scored on multiple criteria into a structured, reproducible result.
Key highlights
- Follows a transparent, reproducible computational procedure that can be audited step by step.
- Handles multiple criteria of differing scales and units within a single decision matrix.
Intuition
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How it works
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When to use it
DEA-ENV models production systems that generate undesirable by-products (emissions, waste). The weak disposability assumption means free disposal of undesirable outputs is not possible — reducing pollutants requires sacrificing some desirable output. EEI1 measures pure environmental efficiency; EEI2 allows policy-weighted assessment of different pollutants. Use EPI for temporal performance tracking.
Strengths & limitations
- Follows a transparent, reproducible computational procedure that can be audited step by step.
- Handles multiple criteria of differing scales and units within a single decision matrix.
- Assumes full compensation — a strong score on one criterion can offset a weak score on another.
Common pitfalls
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Sources
- 1.Färe, R., Grosskopf, S., Lovell, C. A. K., Pasurka, C. (1989). Multilateral Productivity Comparisons When Some Outputs are Undesirable: A Nonparametric Approach. Review of Economics and Statistics
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ScholarGate. (2026, June 2). DEA-ENV. ScholarGate. https://scholargate.app/decision-making/dea-env